Country-of-Origin Effects on Sellers’ Price Premiums in Competitive Philippine Markets

Data collected from highly competitive markets in the Philippines were used to investigate how country-of-origin (CO) information influenced the prices set for a wide range of products. The data permitted direct comparisons between prices for the same product produced by the same company, but in different countries, and sold in adjacent markets. Imported products produced in more industrialized countries were found to command price premiums over the same product, produced by the same company in less industrialized countries. However, imports from all countries commanded significant price premiums over domestically produced products. Consistent with previous research, branding was found to moderate the effect of CO information on price. Finally, CO information had a stronger impact on price when product risk was high than when it was low.